Tri-State Energy Looks to Solar as it “Rethinks” Coal

Tri-State Energy has a lot of ground to cover. The Denver-based energy co-op is responsible for generating baseload power to 1.4 million end users across a 250,000-square-mile service area over 5,200 miles of transmission lines covering Colorado, Wyoming, Nebraska, and New Mexico. Coal obviously plays a big part in delivering all that energy. But things are changing for the power cooperative.

The power wholesaler recently announced a partnership with First Solar to build the Cimmaron Solar Project, a 30 megawatt PV solar facility in northeast New Mexico. Once completed in late 2010 (the plant will come online in phases starting in September of 2010) the 500,000 panel Cimmaron project will be the largest of any power co-op in the world, and one of the largest commercial scale plants of any utility anywhere. Tri-State will enter into a 25-year power purchase agreement to purchase all the power generated from the plant, scalable in 10mW “chunks.”

Formed in the 1950’s on the Rural Electrification Administration model for rural hydropower distribution in early 20th century, Tri-State doesn’t sell power directly to end-users, but to the 44 retail power districts and co-ops for which it serves. The structure of the power co-op mandates a “bottom up” approach according to Lee Boughey, manager of communications and public affairs for Tri-State. Thus, emerging policy trends, renewable energy portfolio standards, and a changing climate calls for Tri-State to reassess its energy resource plans for the future.

Reevaluating the plan

The landscape has indeed shifted since 2005, when Tri-State last announced its long-term goals, leading the board of directors to announce at their last annual meeting in April their intention to reevaluate long-term planning: “The board of directors instructed staff to reevaluate and present options to meet our member systems’ needs in a reliable, affordable and environmentally-responsible manner,” said Hub Thompson, chairman of Tri-State’s board of directors. “The board will continue to assess changing energy and environmental policies as we pursue near-term opportunities and develop our long-term plans.”

How coal fits

One key aspect of the reevaluation of Tri-State’s resource planning is the uncertainty in federal and state policies regulating coal. Within weeks of taking power, the new administration has actively sought to reverse many Bush-era rulings concerning greenhouse gas emissions from coal-fired plants. Combined with the growing call from the scientific community to halt any new coal burning power plants, the stage is clearly set: “Significant changes in the regulatory climate and economy impact development projects have disproportionately affected the near-term outlook for coal-based resources,” said Ken Anderson, executive vice president and general manager for Tri-State. “Part of our reevaluation process will review how coal-based resources fit into our long-term resource plans.”

Diversify and renew

For the near term, projects like Cimmaron represent the shifting focus Tri-State finds necessary to meet their business objectives, both in the long and near term. Diversification from fossil-based energy sources, especially coal, is required, in part, to meet the renewable energy portfolio standards coming in Colorado and New Mexico mandating 10% of power generation come from renewables by 2020.

For Colorado, Tri-State is considered a leader in advancing the state’s new energy economy, according to Colorado governor Bill Ritter: “Since I’ve been governor, you’ve always demonstrated a desire to move ahead,” said Gov. Ritter as he addressed Tri-State’s board. “You deserve a lot of credit for making efficiency, renewables and new technology investments a high priority as you look for new and better ways to provide affordable and reliable electricity to your rural customer-owners.”

The evolution of power

The leadership to which Ritter refers include a growing portfolio of projects and initiatives:

A $30 million investment this year in Tri-State’s generation and transmission facilities

Providing incentives for developing local, community-based renewable energy projects, with the first such project coming online this spring in northeastern Colorado

Contracting for a 220 mW of natural gas-based generating capacity in eastern Colorado. This increased capacity will assist in meeting near term power requirements while helping in the integration and transition to renewable energy

And, of course, projects like Cimmaron, that will soon be a major step forward in advancing the new energy economy throughout the region

Tri-State is also involved in research to help find longer term solutions to sustainably meet the demands of its customers. Examples include research on carbon capture and storage (CCS) technology or its partnership with the Palo-Alto based Electric Power Research Institute and other power companies to develop solar concentrator technology to integrate with existing coal-fired plants (pdf).

Coal is a king to be conquered

Tri-State operates in the heart of coal country, where mile-long trains carrying mountains of coal endlessly snake through the region. Coal is king, but it is one to be contained and eventually subjugate. Tri-State is placing its development and research dollar on the reality that one day the “king must die.”

Perhaps it is through the reassessment of goals from long-established power wholesaler, that has for decades relied almost exclusively on coal and fossil fuel as its primary resource, that change and shifting priority can portend a fundamental reworking of our energy economy.

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